WSJ Technology: Samsung vows to fight ban
Apple is looking to ban the sale of eight Samsung phones in the U.S.. How will this affect Samsung and other mobile-phone makers around the world? Analyst Mark Newman of Sanford Bernstein tells the WSJ that Samsung has little to worry about-for now.
After winning a jury verdict for patent infringement against Samsung in a U.S. court last week, Apple on Monday asked the presiding judge for a permanent injunction against the eight phones that accounted for most of Samsung’s U.S. smartphone revenue in the first six months of the year.
Apple told Judge Lucy Koh that it reserves the right to pursue permanent injunctions banning the sale of all 28 devices that the jury on Friday found to violate Apple’s intellectual property. Apple also offered, in response to an order by Judge Koh, what it called a “tailored” list of eight Samsung products “to address a portion of the immediate, ongoing irreparable harm that Apple is suffering,” according to the filing.
Samsung responded on Tuesday with a one-sentence press statement. “We will take all necessary measures to ensure the availability of our products in the U.S. market,” it said.
A Samsung spokesman said the company’s options included filing to stop the injunction, appealing if the judge grants it, and modifying products.
Samsung officials have already begun to talk to wireless carriers about removing or modifying infringing features to keep products on the market if the injunctions are granted, according to a person familiar with the matter.
One of the most important devices in the scenario planning is the Galaxy S II smartphone, several versions of which are on sale in the U.S. It was found to infringe patents related to the design of the phone and some involving software features.
Samsung has said it has workarounds for two patents related to software features.
The phones that Apple included on its list for a sales ban don’t include the newest products in Samsung’s lineup, the Galaxy Note and Galaxy S III, which weren’t part of the just-ended court case. Apple is seeking a sales ban on the Galaxy S III in another case in the U.S.
The Samsung products on Apple’s injunction list are the Galaxy S 4G, Galaxy S II AT&T, Galaxy S II Skyrocket, Galaxy S II T-Mobile, Galaxy S II Epic 4G, Galaxy S Showcase, Droid Charge and Galaxy Prevail.
Together, those phones accounted for $1.3 billion in Samsung’s U.S. sales during the first six months of the year, according to records in the California court case. Including the 20 other models involved in the court case, Samsung had $1.5 billion in U.S. sales.
While the devices aren’t Samsung’s latest products, many are still available through wireless carriers and online retailers such as Amazon.com Inc.
Peter Toren, a patent attorney with Weisbrod Matteis & Copley PLLC in Washington, said Judge Koh is likely to grant Apple’s latest request, given that she already issued one preliminary injunction against the tablet-style computer Galaxy Tab 10.1 before the trial began.
Samsung has said it would seek to overturn the verdict, first through post-trial motions with Judge Koh and through an appeal if necessary. During that process, it could ask an appeals court to stay a preliminary injunction.
Though the appeals court could grant an expedited hearing, Mr. Toren said, he said it usually takes nine months to a year for the appeals court to hear a patent case.
The jury’s verdict Friday—which found that Samsung infringed six Apple patents—validated Apple’s claims that popular devices such as the iPhone were copied by its rival.
Some patent lawyers and industry executives predict the decision could affect a number of players in the mobile-device and software industries, including Google Inc. Both Samsung’s Galaxy and Droid models are built around mobile software provided by Google.
Representatives of Google couldn’t immediately be reached for comment.
Separately Tuesday, Moody’s Investors Service issued a note saying Friday’s verdict is “credit negative” for Samsung but “will not have any impact” on its credit rating. It said Samsung “has a strong diversified business position and substantial financial cushion to absorb the cash damages.”